Brian Reames, Highwoods Properties senior vice president and regional manager, stands in front of The Pinnacle at Symphony Place,which his company bought for $152 million. / Steven S. Harman / The Tennessean

Highwoods Properties Inc., the Nashville area’s largest office landlord, raised a few eyebrows last month when it acquired the city’s most expensive office address for a record per-square-foot price.

Until that $152 million deal, the Raleigh, N.C.-based real estate investment trust was known largely for its holdings in the suburbs. Having acquired downtown’s The Pinnacle at Symphony Place, Highwoods now owns, manages and leases 3.1 million square feet of office space here — 10 percent of the overall market and a 15 percent market share in submarkets where it owns property.

Brian Reames, Highwoods’ senior vice president and regional manager over its Middle Tennessee operations for 17 years, chatted with Tennessean growth and development writer Getahn Ward about the Pinnacle acquisition, the company’s local position, plans and strategy moving forward, and broader trends in the office market here.

When did you get into real estate and how did you end up working with Highwoods?

From my college days, I knew I wanted to be in commercial real estate and specifically development. That was all I ever wanted to do. It was the real estate investment — the income generated from rental or leased real estate — that really sparked my interest.

Highwoods entered the Middle Tennessee market in 1996 through the acquisition of Eakin & Smith and a portfolio of office buildings. I was one of a core group of real estate professionals at that firm who joined Highwoods and continue to work here today.

What shift in Highwoods’ strategy does the acquisition of The Pinnacle reflect?

Back in 2005 our CEO, Ed Fritsch, led the team through a major overhaul that transformed our company. We made some very difficult decisions and implemented a strategic plan that included selling over $1.5 billion in non-core properties and land.

Our strategic plan did signal a shift to newer, higher-quality assets in infill locations with typically higher barriers to entry — meaning it’s not as easy for someone to pop a building up and compete with you. We call these areas “BBDs,” or better business districts, as opposed to the central business districts. It is a shift.

We’ve sold off a lot of our older buildings, not just in Nashville but companywide, and we’re acquiring and developing things that are more closely aligned with our strategic plan. We weren’t as focused in 2004, and the company wasn’t performing as well as it should have been, so Fritsch came in as CEO, sat everybody down and said: “Let’s refocus.” That was the beginning.

Did low interest rates or lack of development opportunities play any part in the timing of the Pinnacle deal? With your recent activities in the market, does Highwoods have appetite for any big transactions here?

We’re constantly evaluating potential acquisition opportunities and we actually had been looking at The Pinnacle a long time, following the leasing progress until it became available. But low interest rates played no factor. In fact, we paid off the loan at closing. We paid all cash for the building.

We’ve got a really strong balance sheet, and Nashville’s one of our better markets, healthier markets. We still have plenty of capacity, so we’re going to continue to evaluate potential acquisitions and development opportunities here and in other markets.

What did Highwoods’ sale of its airport-area portfolio say about that submarket?

We identified the airport portfolio as non-core back when we went through our strategic plan. We recycled that capital into newer assets like The Pinnacle in infill locations and higher barriers to entry. (The airport portfolio had) some of the older properties in our portfolio. They would not be considered infill, which is a key metric in our investment analysis.

Could we see you doing any more future developments in Davidson or Williamson counties given projects such as the LifePoint headquarters at Seven Springs and plans for the mixed-used Ovation project in Cool Springs?

We’re constantly evaluating development and acquisition opportunities. Near-term, I don’t see anything in addition to what we already have on our plate, but things do change quickly, and we’ll be ready when opportunities arise.

We’re very pleased with our land position in Davidson and Williamson counties. We’ve got a great land position at Ovation and also at Seven Springs. When other development opportunities pop up, we’ll be ready, but we feel good about the land positions we have. We’re always looking at potential acquisitions. That’s just part of the natural flow.

Any significance to the timing of your land purchase for Ovation? How will the 1.4 million square feet of office space you plan affect inventory in that submarket?

We were out of land and we’ve had great development success in Cool Springs. ... It’s one of the most dynamic, fastest-growing office submarkets in the country. And so we needed a significant land position.

With SouthStar (Highwoods’ partner in Ovation), we’re bringing a very unique mixed-use product to that market. We think it will be complementary to the market. We don’t see it affecting the market in anything but positive ways. It’ll be a different office environment for potential Middle Tennessee companies and relocations to consider. Cool Springs has really matured. It’s a major submarket now, and the space planned for development over the next decade or so is just a healthy add. It’s needed. It’s also one of the tightest submarkets. We just hit an all-time low for (Class A) vacancy at 4.7 percent, and there’s limited new construction right now.

You’ve got a very disciplined development community, an all-time low vacancy rate, and I don’t see overbuilding anywhere on the horizon at this point. If anything, it’s the opposite. We’re in danger of not having inventory and missing out on opportunities as a region.

What’s the overall construction timeline for building out at Ovation?

Once it gets started, you’ll see the retail and the hotel and the residential built out relatively quickly, probably over a two- to three-year period.

I’d like to think we’d have office (space) completely built out by 2025, but this is important: It was underwritten to be absorbed much more conservatively than that. I’d like to think we’d be done, once we started, in a 10-year period, but our investment analysis allowed for more time than that.

Do you plan to build speculatively or build to suit as in the deal with LifePoint?

Over the years, we’ve been very successful building speculatively. But currently, we have no plans to develop a speculative office building.

Having said that, we’re always evaluating. It’s more likely you’ll continue to see built-to-suit developments or developments with a heavy pre-leasing component — rather than purely speculative.

What’s the latest at Seven Springs, including work on LifePoint’s headquarters?

We’re getting ready to open the LifePoint Hospital Support Center at the end of the year and we continue to sign leases at Seven Springs retail. We’ve got great activity and we’re really excited about how it’s going to turn out.

What has changed in terms of the buildings office tenants are looking for today?

In general and more so in the suburbs, office tenants have a higher parking demand. That’s just kind of the single biggest trend. But I think the mixed-used developments that are emerging now are going to take some of the pressure off of that trend. Today, office tenants generally are looking for less hard-walled offices and more collaborative space.

We call it “we” space versus “me” space. Going forward, office tenants are looking for more of that “we” space or that collaborative space than the traditional space of old.

In what other ways did the recent U.S. economic downtown affect Highwoods?

We fared well, fortunately, and came out of it as healthy as we’ve ever been. ... Again, I attribute that to the vision of our CEO, who led us through that plan ahead of the recession. So we were in much better shape going in than most of our peers.

We sold over $1.5 billion of non-core land and property. We basically paid down debt and, when we came out, could immediately acquire and develop on a large scale as the economy improved.

What’s your assessment of the current state of the Nashville office leasing market?

With things as tight as they are, there are a lot of things out in the marketplace. There’s no shortage of opportunities. Middle Tennessee is a very attractive place for business, and we’re just trying to be in a position to accommodate the demand. It’s very active. Rents are strong in every submarket and they’re increasing in almost every area, which is no surprise given the vacancy statistics.

Where’s the next boom in commercial development or the next Cool Springs?

Right now, there’s so many areas of Middle Tennessee that are booming. But in terms of where’s the next Cool Springs, I always come back to Brentwood because of its location, housing, amenities. It’s midway between downtown and Cool Springs. If the city’s leaders ever embraced a rezoning of one of the large tracts along I-65, there could be a really special mixed-use development there that would be very beneficial to the community.

How does Brian Reames spend most of his time when he’s not working?

Usually, I’m trying to do something with my family. More often than not, that’s what it is.